Bitcoin Will Prove It Never Had Any Substance, Claims Billionaire Skeptic Howard Marks

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Billionaire Howard Marks, the co-founder of Oaktree Capital Management, said bitcoin will eventually fizzle out and prove once and for all that it never had any substance.

Marks, whose net worth tops $1.9 billion, made the scathing remarks at the 2018 Delivering Alpha conference in New York on July 18. The annual hedge fund summit is jointly presented by CNBC and Institutional Investor.

Marks said bitcoin is not a worthwhile long-term investment vehicle, but merely a short-term trading opportunity.

“[Bitcoin is] not an investment…it’s a trade,” Marks told CNBC. “In the long run, I think it will be shown not to have any substance.”

Bitcoin is a ‘Greater Fool Theory’ Investment: Marks

Marks said people who are buying bitcoin do so only because they want to turn a quick profit by selling off their holdings to a “greater fool” than themselves.

“This is what we called, when I was a kid, the ‘greater fool theory,'” he said.

As bitcoin makes its latest attempt to break from the bear market, billionaire investor Howard Marks joins the list of Wall Street skeptics.

“They think someone will buy it from them at a higher price,” Marks said. “Not because they can specify its intrinsic benefits. Not because they can judge the intrinsic value. But only because they think it’s going up.”

Howard Marks’ sentiments echoed those of billionaire Bill Gates, another notorious bitcoin skeptic. As CCN previously reported, Gates said bitcoin has no inherent value and ultimately will implode along with the rest of the cryptocurrency market.

“As an asset class, you’re not producing anything, so you shouldn’t expect it to go up,” Gates said. “It’s kind of a pure ‘greater fool theory’ type of investment.”

According to Forbes, Marks’ Oaktree Capital has $121 billion in assets under management, and its average investor has a net worth of $2 billion. Those are some huge financial whales that Marks and his investment firm are advising to steer clear of the crypto industry.

Tech Billionaires: Bitcoin Is the Future

Bitcoin has recently rallied after plunging below $6,000 for the past few months. The summer slump was unexpected, as many market observers had expected cryptocurrency prices to surge.

Despite the increasing drumbeat of cryptocurrency naysayers, today’s new crop of tech billionaires has no doubt that bitcoin is the undisputed wave of the future.

Samantha Chang is a politics writer at BizPac Review and a financial editor. She is a law school graduate and an alum of the University of Pennsylvania. You can follow her on Twitter @Samantha_Chang. Read more of her CCN cryptocurrency articles here.